Proposed National Energy Policy (8/01)

The following column by GAP Senior Advisor John Dragonetti is reprinted from
the August/September 2001 issue of The Professional Geologist, a publication
of the American Institute of Professional Geologists
. It is reprinted with permission.

A clear signal as to the significance of energy policy to the new administration
was President George W. Bush’s creation of the National Energy Policy Development
(NEPD) Group during his second week in office. The importance of the group
was evident by its composition. Vice President Dick Cheney was selected
to head the assembly that consisted of 14 cabinet members, agency chiefs,
and top White House advisors. On May 16th, the NEPD delivered an extensive
report to the President. The report containes 105 proposals reportedly
designed to overcome the obvious imbalance between the country’s energy
needs and the available supply. The plan suggests actions to be accomplished
throughout the government: 12 would be implemented by executive action,
federal agencies would be responsible for carrying out 73, and Congress
would accomplish the remaining 20. In the cover letter accompanying
the report, the Group asserted that the NEPD aims to promote dependable,
affordable and environmentally sound energy production to satisfy the nation’s
future energy needs. Also identified for concern is the ever-increasing
dependence on foreign oil imports, anticipating that the 52 percent required
in 2000 will rise to 64 percent by 2020. Another issue of importance
is the shrinking capacity of the Strategic Petroleum Reserve to respond
to oil supply disruptions. It was stated that the 83-day capacity in 1992
has since been reduced to the current 54-day supply.

The ProblemIn an ominous projection, there was warning of a looming energy shortage
that would rival that experienced in the 1970s when the U.S. produced 39
percent more oil than it now does. Citing the expanding economy, increasing
population, and higher standard of living; energy conservation and technological
advances in energy efficiency would be required to face the problem of
energy deficiencies. Recognized were needed repairs to and expansion of
the nation’s energy infrastructure to respond to the outdated transmission
lines, pipelines, refineries and electricity generators presently considered
to be inadequate or inefficient.

Proposed National GoalsFive specific national goals were identified. These are to modernize
conservation practices, to renovate the existing energy infrastructure,
to increase domestic energy supplies, to increase and improve environmental
protection, and to improve the nation’s energy security.

RecommendationsRecommendations to increase energy production include the suggested
opening of part of the Arctic National Wildlife Refuge and using $1.2 billion
from the successful bid bonuses for research into alternative and renewable
energy resources. An executive order was issued directing federal agencies
to consider regulatory action to accomplish energy conservation. Legislation
will be suggested to expand alternative fuel tax incentives. In addition
the report recommends funding clean coal technology research at a $2 billion
level over a ten year period. Other production-oriented recommendations
include streamlining the hydropower and nuclear licensing processes and
expanding the use of nuclear energy in conjunction with the establishment
of a national repository for nuclear waste. The report stressed that all
the proposed activities would be accomplished using environmentally sound
practices.

Environmental PositionTwo full chapters of the report, entitled “Protecting America’s Environment”
and “Using Energy Wisely,” are devoted to environmental issues. Air
quality, cleaner electrical generation, development of clean coal technology,
improved efficiencies in electrical production, the need for improved water
quality, and the need for ecosystem protection are all specifically addressed.
However, if these inclusions were intended to satisfy the environmental
community, it does not appear to have worked. Environmental groups have
criticized the plan and hinted at strong opposition.

Conclusion
The power shift in the Senate to the Democrats with Senator Jim Jeffords (VT)
departure from the Republicans to become independent will reflect a dramatic
change between the Senate majority and the White House proposal. The change
in leadership of the Senate Energy and Natural Resources Committee from Frank
Murkowski (R-Alaska) to Jeff Bingaman (D-New Mexico) may not affect much
of the proposal except for the issue of drilling in the Arctic National Wildlife
Refuge. Yet there are clear indications that a fierce battle in Congress
over the environmental implications of energy production is bond to occur.

This column is a bimonthly feature written by John J. Dragonetti,
CPG-02779, who is Senior Advisor to the American Geological Institute’s
Government Affairs Program. The complete text of the energy report is available
at the White House website, http://www.whitehouse.gov/energy/. Additional
information on the energy report and current energy issues in Congress
is available at the http://www.agiweb.org/gap/legis.html#energy.

This article is reprinted with permission from The Professional
Geologist, published by the American Institute of Professional Geologists.
AGI gratefully acknowledges that permission.